Ross Stores profit hits high end of guidance

MelodieWarner

Ross Stores Inc.'s
ROST, -0.36%
fiscal fourth-quarter earnings rose 23%, matching the high end of its guidance, as the off-price apparel and home-fashion retailer's margins also improved.

The company buys merchandise from department stores and sells it at a discount. Ross has continued to post profit growth as it attracts bargain-hunting consumers amid a sluggish economy.

For the quarter ended Feb. 2, Ross Stores reported a profit of $236.6 million, or $1.07 a share, up from $192 million, or 85 cents a share, a year earlier. The company in February had raised its per-share earnings guidance by a penny to between $1.06 and $1.07.

Operating margin improved to 13.6% from 12.9%, partly due to a 65% drop in interest expense.

The company recently reported that sales rose 15% to $2.76 billion as same-store sales rose 5%. The latest period included an additional week of sales.

Beginning with the fiscal second quarter, Ross said it will no longer release monthly sales reports.

"Reporting sales quarterly aligns us with the majority of other retailers who have already adopted this practice, while also increasing the focus on longer-term performance," said Vice Chairman and Chief Executive Michael Balmuth.

Shares closed Wednesday at $56.71 and were inactive premarket. The stock has risen 3.9% so far this year.

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